I shot the sherrif.
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Green tech. needs to be able to compete with current energy markets on its own two feet, not by making current energy more expensive.
Cheap energy is what drives economies, and cheap labor. So what's the final multiplier on having the Gov. spend money on construction? Do those numbers take into account not just taxes/wages/spending but also the offset of not having to pay this person medicaid/unemployment/lost housing etc.? Google is your frenemy. Caveat Emptor - Latin for tough titty I tend to interpret things in the way that's most hilarious to me |
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Veteran Member
Join Date: Jul 2005
Location: Unknown
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And regarding the "(let's start calling it what it is: "spending")" - that's kinda the point. We are Spending money to Stimulate the economy. This isn't some kind of double-speak code word that they're trying to slip by people. Let go of the paranoia. And for everyone who wants to argue the whole "let the free market find a fix for this" and "this isn't something for the Government to solve" let's please remember that it was the business/financial sector that got us into this whole mess - I have no faith in them at this point in coming up with a solution. Why should I? Do you know where children get all of their energy? - They suck it right out of their parents! |
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Antimatter Man
Join Date: May 2004
Location: that interweb thing
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Now where did I hear 'tax cuts will solve everything'?
Oh yeah... the last 8 years of trickle-down-trust-us neocons (despite evidence it failed the last time it was tried under Reagan). How'd that policy go this time? Oh yeah... from record budget surplus in '99 to record deep in the shitter '08. Unprecedented corporate greed. Wider gap between rich and poor. Financial collapse. Forgive me if I'm a bit skeptical of the 'all-it-takes-is-tax-cuts-trust-us' blowhards. Time for a fresh approach and a bit more balance. All those who believe in telekinesis, raise my hand. |
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is the next Chiquita
Join Date: Feb 2005
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Um, the past tax cuts didn't work because 1) it was a break for cronies and special interest, rather than a general tax cut but more importantly 2) it wasn't accompanied by a cut in spending and contraction of government intervention. Both Reagan and Bush promised tax cuts and small government; delivered in bad faith for former and completely failed on the latter.
So it's certainly not "it just takes a tax cut", and definitely not "it just takes extra spending". |
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Join Date: Jan 2005
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It's really amazing how Republicans think tax cuts are the solution for everything. Of course, there would be a time when they would have to come up with something else - when the marginal tax rate goes down to 0%!!! I mean just think about it logically. At some point one would think that we have arrived at a "perfect" tax rate - but for Republicans, this never seems to be in reach. It's always "lower than what we have now". That made sense during the Carter years, but it doesn't now. |
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is the next Chiquita
Join Date: Feb 2005
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It sound all great but you have to answer the question of "where is the money coming from?"
There is no free lunch to be had, and spending ourselves into debt atop a mountain of debt is certainly is not going to get us a lunch. Nobody was listening to David Walker, and he was warning when the times was good, long before mortgage crisis blew up. After spending more money, we're saying "spend more!" Look, all I've been hearing is "less taxes! more spending!", and we've been getting both a-plenty. Both camps got what they wanted. Forgive me if I don't feel at all confident that it'll fix anything. |
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is the next Chiquita
Join Date: Feb 2005
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and that's not a free lunch. It'll have to be repaid, with interest. We've been operating on deficit budget for years, if not decades. Show me *anyone* who successfully has run just five years of deficit budget, had already squandered the savings or didn't have any to start with, and not declared bankruptcy and I'll shut up. To think that government should be exempt from that inconvenient responsibility is silly.
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Join Date: Jan 2005
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Didn't Reagan have a deficit the entire time he was in office, due to tax cuts and military spending that was out of control? BTW, under Clinton we had a surplus. What happened to it? |
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is the next Chiquita
Join Date: Feb 2005
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According to Bureau of Public Debt, interest cost $451 billion atop $10 trillion of outstanding public debt. or 4.5% of the debt. Certainly a better deal than an average credit card debt, granted, but debt is debt, whether it comes with pink frilly ruffled dress or not. The stimulus package we're talking about easily is 10% of the current outstanding debt, and we didn't even consider the bailout package. As I've alluded to earlier, if you're up to eyeball in debt, do you go out and spend even more and hope you make money to pay off your old debt? Unlikely. At this point, the best thing is to quit pursuing high-risk activity, cutting losses and tightening belts and spending only on the necessities until things change for better. Oh, please do leave out partisan finger-pointing. If you've missed, I've berated both camps for cutting taxes and spending too much. The only solution neither camps has tried is butting out. I'm kinda of getting tired of either camp jumping up and down and yelling "Fire!" everytime someone farts. |
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Banging the Bottom End
Join Date: Jun 2004
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Join Date: Jul 2005
Location: Unknown
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The problem with such things is that they don't create jobs. Surveys have shown that most people ended up saving or paying off debt with their rebates/stimuli. This stimulus plan, however, is focused on putting people to work and working people are the true foundation of the economy. Right now, we are losing them by the boat-load and we need to reverse that trend ASAP. You've heard the adage about giving someone a fish vs. teaching them to fish I assume. Well this isn't so much teaching them to fish, but giving them a fishing pole and a place on the river/lake to cast it. Do you know where children get all of their energy? - They suck it right out of their parents! |
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Let me say this: "I'm very pro-kensyian economics."
I believe the government should increase taxes first off. Yes this may be unpopular, but it give the government increased income and lowers the saving rate of people. Keep in mind, while saving is good for the individual, it's bad for the country. Next I feel the government needs to go on a massive public works project. Screw road that this entailed in the New Deal, but rather all forms of education, building school, more teachers, more universities, and most of all, more R&D. Now while infrastructure shouldn't be entirely ignored, we do need more energy, solar, clean coal, nuclear... You might have qualms with any of these things, but really, there isn't much choice. It also has direct positive correlation with GDP. Next we need to increase the progressive tax. Far less for the middle class and accordingly higher for the upper calls. The wealthier you are, the more you save and the less you are helping the economy. Trickle down effect my ass. Unless you are promoting investing, tax cuts really do not help, they might feel good to use, but in reality, we just don't spend all that we get for the tax cut where as public works does. Retired 8 years ahead of schedule. |
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Join Date: Jan 2005
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To put it another way, let's say I could borrow XXX amount of dollars right now at 4.5% interest, and invest it in the market. In 30 years, compare the amount of interest I would pay back versus my return in the market. That would be a great deal, even with a recession or two thrown in to the mix. Now, if interest were 14.5%, this strategy wouldn't make any sense. That math should be obvious. |
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People need to stop seeing house as investments. If people realize that if they invested in a mutual fund with a conservative 7% return and purchased a smaller home, they would make significantly more money. A house is a way of life, not your retirement fund. See: WSJ (link coming shortly)
Retired 8 years ahead of schedule. |
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I shot the sherrif.
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I don't think you can "beat the returns" on a loan if you're just using the money to pay off someone else you owe.
We're borrowing in part to pay off other borrowing. Google is your frenemy. Caveat Emptor - Latin for tough titty I tend to interpret things in the way that's most hilarious to me |
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Veteran Member
Join Date: Jan 2005
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Let's say I owe 17% on a credit card. Wouldn't it make sense to borrow at 4.5% to pay it off sooner?
People talk about debt as a percentage of GDP being 60%. That sounds like a huge number, but what does it really mean? Anyone who owns a house likely has a huge debt. And amazingly enough, people who own houses and huge debts, still find the means (until recently) to borrow all the time to pay for cars, college, startups, etc. Look at the following chart. It turns out the debt ratio was as high as 120% during WWII (obviously due to war time borrowing), and went way down to near-20% in the 1970's. Would one say that the 70's were roaring and grand? |
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BANNED
I am worthless beyond hope. Join Date: May 2004
Location: Inner Swabia. If you have to ask twice, don't.
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Join Date: Jan 2005
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It's so nice to have a President again who can actually speak in coherent sentences.
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I shot the sherrif.
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The issue is that it's not 30 year T-bills that are being bought/sold. It's shorter term loans owned by other countries, not US citizens. It's less stable, and the people holding the debt don't care about returns over a long haul at this point as much as returns for the next 6 to 12 months.
Don't get me wrong, I don't think we should pass on the stimulus this time, especially if it actually goes to specific projects to help sustain jobs. I do, however, think it's very dangerous to just keep borrowing more and more money and pushing off when you'll pay it back into some distant, unplanned "future" where it's not our problem. I also can't help but notice looking at those graphs, the gap between gross and public debt is wider than ever before, and shows no signs of going back. Google is your frenemy. Caveat Emptor - Latin for tough titty I tend to interpret things in the way that's most hilarious to me |
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Here's a quick primer: T-Bills: 0-365 Days T-Notes: 1 - 10 Years T-Bonds: 10 - 30 years Hope that helps! Now that I got a job, I can buy more Apple products! |
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I shot the sherrif.
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Ah. I stand corrected.
My understanding then is the debt has started to shift to T-bills instead of T-bonds. |
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That's a different issue: you are correct. Until recently the US Treasury was borrowing more and more in the short end of the yield curve (i.e., T-bills to 2-year notes), but that is all about to change with a $800 B+ Stimulus/Spending bill. The Treasury last week announced that the are bringing back the 7-year note auctions and also double the size of the 30-year auctions.
Now that I got a job, I can buy more Apple products! |
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BANNED
I am worthless beyond hope. Join Date: Dec 2005
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I also find it hard to trust his supposed desires for bipartisanship when he constantly attacks and belittles the other side and his biggest argument is that he is not republican. Whether his criticisms, attacks and arguments are valid or not, they sure aren't going to make republicans any more enthusiastic about working with him. if change is truly here I would like it if he just stopped talking about the previous 8 years and considered it the past and start defining his own destiny. He's just falling into traps and his handling of this stimulus package has left a lot to be desired. |
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My favorite parts of the night were:
1. How he cut off Helen. 2. How he threw Joe under the bus (I suspect that latter will be common going forward! SNL already having a field day with Joe.) Now that I got a job, I can buy more Apple products! |
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Veteran Member
Join Date: Jan 2005
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It's about change. Change from the way things have been run into the ground over the last 8 years. |
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is the next Chiquita
Join Date: Feb 2005
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I also have to remind that we've been running on deficits and will likely do so again this year and perhaps for rest of Obama's terms. At what point will we *not* have a deficit? In Keynesian framework, a little inflation is good because that promotes spending, which appeals to politicans because they can now run on deficits and claim it's good for economy. But they're forgetting that money supply is neutral in regards to any measure of wealth. It really doesn't matter whether we are trading in gold Eagles, American Dollars or Zimbabwean Dollars, the cost of a given good is still the same being merely quoted in different units for each potential money. The fallacy here is that money is regarded as a store of value, when it's actually a medium of exchange. Yet, no matter how one monkeys with the money supply and how it is denominated, the real prices for various goods will remain unchanged until the supply or demand curves changes. The stimulus is based on just that premise, and within Keynesian framework, it makes sense to spend during hard times. However, this misses out on the question of funding such move, and looking at how we've been spending for decades, it seems to me that government is in fact responsible for encouraging and creating boom-bust cycles with setting interest rates via Federal Reserves (if only a quasi-private institution with some Congressional oversight... whatever it means), running deficit after deficit and continually expanding money supply thus creating inflation. It may been AIG that cooked up the crooked scheme of credit swaps, but they certainly were abetted by Greenspan's interest rates cuts and government intervention in effort to increase homeownership. On top of all this spending, cutting taxes in name of promoting consumership/increasing prosperity/bringing good times/whatever excuses they used, they're telling us to do more of same? That's definition of insanity, isn't it? And the argument is over whether we should cut tax or spend more!!! |
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Veteran Member
Join Date: Jan 2005
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You can't have it both ways. You can't criticize Obama for doing something that needs to be done, while at the same time blaming him for the debt that has accrued to this point and for increasing that debt, which he must now do. It's not fair to him, and it's not really a logical argument.
The question: Should we pass a stimulus now or do nothing? It's either yes or no. If you were Obama, what would you do? |
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